Combined Reporting Instructions (Page 3 of 5) in pdf

instance can a utility corporation or financial institution carry forward a NOL. See 830 CMR

63.32B.2 (8).

Header for Schedule U-MTI

For each Schedule U-MTI filed, enter the name of the member (as stated on its federal

income tax return, if filed), its Federal Identification number and the beginning and ending

dates of the group’s tax year. Also enter the name and Federal Identification number of the

principal reporting corporation.

Line and Column Instructions

Line 1 through Line 11. Enter the amounts to be referenced are the amounts of income, by

line, attributable to the non-unitary business activity that is being reported. This income

should have previously been excluded from the unitary group’s business income in column e

on Schedule U-M. The amounts reported in lines 1 through 10 of Schedule U-MTI must

match the amounts reported on Schedule U-M, column e, lines 1 through 10. Line 11 must

equal the total of lines 3 through 10.

Line 12. Report the total of all deductions that are included in the amounts set forth on lines

12 through 26 of U.S. Form 1120 that are attributable to sources other than the combined

group’s unitary business. These amounts must be excluded from the corresponding items to

be made on Schedule U-M for the purpose of determining the deductions from group income.

Line 14. A taxpayer must add back to net income any related member intangible expenses

and costs, including losses incurred in connection with factoring or discounting transactions.

(Note that the use of intellectual property owned by related party’s taxable under Ch. 63 that

is also members of the combined group suggest that the activity is part of the unitary

business.)

Line 15. A taxpayer must add back to net income any related member interest expenses and

costs, including losses incurred in connection with factoring or discounting transactions.

Line 16. The amounts to be reported here include any adjustment required to the income or

expenses reported in lines 1 through13 with respect to differences between the calculation of

Massachusetts and federal net income.

Line 18. Where either a financial institution or a business corporation, as determined under

the provisions of Ch. 63, receive a dividend from another corporation in which it owns at

least 15% of the voting stock, it is entitled to a 95% dividends received deduction if the

statutory requirements are otherwise met. See M.G.L. Ch. 63 sec. 1 or 38. Where a utility

corporation receives a dividend from another utility corporation in which it owns at least 80%

of the stock, it is entitled to 100% exclusion for such dividends received. See M.G.L. Ch. 63

sec. 52A. To the extent that the dividends for which the deduction is claimed are included in

the amounts reported on Schedule U-MTI, the dividends received deduction is to be claimed

on line 18. The corporation claiming the deduction must also complete and enclose Schedule

U-DRD, and, in so doing, should reference the unitary business identifier on such Schedule

U-DRD as “0”. The amount of the deduction claimed must not exceed the amount stated on

Schedule U-MTI, line 4.

Combined Reporting Instructions Page 3